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VOLUME:

VI - POLICIES RELATED TO THE TREASURER’S OFFICE

SUBJECT:

Stop Payment and Reissuance of Disbursement Checks (non-payroll)

SOURCE:

Office of the Treasurer

DATE ISSUED:

October 1990

POLICY NO.

VI - 30

RATIONALE:

To ensure that university financial records are updated in an accurate and timely manner for all transactions relating to the reissuance of university disbursement checks that are lost, stolen or mutilated.

POLICY:

University departments may request that stop payment orders be placed on disbursement checks that have been lost, stolen or mutilated, and replacement checks be issued to the payee. The Tax Management & Treasury Accounting department will be responsible for placing all stop payment orders on university disbursement checks at the appropriate bank. All requests for stop payment orders and check reissuance must be accompanied by a Request for Stop Payment, Form A-121-A.

In the event that both the original check and the reissued check are cashed by the payee, the initiating department will be responsible for pursuing reimbursement from the payee for the duplicate payment. The Tax Management and Treasury Accounting will be responsible for any related communications with banks and other financial institutions.

DEFINITIONS:

Guarantor’s Statement A statement that protects the University against financial loss in the event that a stop payment order and check reissuance occur after the original check was cashed. The guarantor’s statement of Form A-121-A reads as follows:

Outstanding Check A check issued by the university that has not been cashed or canceled.

Stop Payment Order A directive given by the university to the bank on which a particular check is written, that calls for the bank not to honor the check when it is presented for payment.

PROCEDURE REFERENCE:

Requests for stop payment orders and check reissues can be processed by Tax Management and Treasury Accounting two ways, depending on the preference of the department or account manager.

Normal Reissue Tax Management and Treasury Accounting will hold the request for stop payment form until the ensuing monthly bank statement is received (usually taking between 30-45 days) to verify that the check remains outstanding. If the check remains outstanding, authorization for issuing a replacement check will be granted by Tax Management and Treasury Accounting to the Financial Management Support.

Immediate Reissue In the event that a department wants a check to be reissued immediately, a guarantor’s statement (see definition above) signed by the appropriate university account manager must be filed with the Tax Management and Treasury Accounting department before a stop order will be placed at a bank. After the guarantor’s statement is received, authorization for issuing a replacement check will be granted by Tax Management & Treasury to the Financial Management Support department.

Stop payment requests received prior to the close of bank business operations (typically 2:30 p.m.) will be processed on the day the request is received. Stop payment request forms can be sent to Tax Management & Treasury Accounting via facsimile transmission. Additional procedural direction will be provided by the Tax Management and Treasury Accounting department.

CROSS REFERENCE:

See Payroll Administration Policy IV-30, Stop Payment and Reissue of University Payroll Checks.

RESPONSIBLE ORGANIZATION:

Treasurer’s Office